Under the EB-5 program, individuals are eligible to apply for conditional lawful permanent residence (a conditional “green card”) in the United States if they make the necessary investment in a commercial enterprise in the United States and create or, in certain circumstances, preserve, at least 10 permanent full-time jobs for qualified U.S. workers. One aspect of the EB-5 program is to target investments in areas of high unemployment.
United States Citizenship and Immigration Services (USCIS) published a final rule on July 24, 2019 that makes a number of significant changes to the EB-5 Immigrant Investor Program. The final rule will become effective on Nov. 21, 2019.
Major changes to EB-5 in the final rule include:
- Raising minimum investment amounts: Perhaps most significantly, as of the effective date of the final rule, the standard minimum investment level will increase from $1 million to $1.8 million. The rule also keeps the 50% minimum investment differential between a Targeted Employment Area (TEA) and a non-TEA, thereby increasing the minimum investment amount in a TEA from $500,000 to $900,000. The final rule also provides that the minimum investment amounts will automatically adjust for inflation every five years.
- TEA designation reforms: The final rule outlines changes to the EB-5 program to address gerrymandering of high unemployment areas (which according to USCIS, means deliberately manipulating the boundaries of an electoral constituency). Gerrymandering of such areas was typically accomplished by combining a series of census tracts to link a prosperous project location to a distressed community to obtain the qualifying average unemployment rate. DHS will eliminate a state’s ability to designate certain geographic and political subdivisions as high unemployment areas; instead, DHS would make such designations directly based on revised requirements in the regulation limiting the composition of census tract-based TEAs. These revisions will ensure TEA designations are done fairly and consistently, and more closely adhere to congressional intent to direct investment to areas most in need.
- Clarifying USCIS procedures for removing conditions on permanent residence: The rule revises regulations to make clear that certain derivative family members who are lawful permanent residents must independently file to remove conditions on their permanent residence. The requirement would not apply to those family members who were included in a principal investor’s petition to remove conditions. The rule improves the adjudication process for removing conditions by providing flexibility in interview locations and to adopt the current USCIS process for issuing Green Cards.
- Allowing EB-5 petitioners to keep their priority date: The final rule also offers greater flexibility to immigrant investors who have a previously approved EB-5 immigrant petition. When they need to file a new EB-5 petition, they generally now will be able to retain the priority date of the previously approved petition, subject to certain exceptions.